The Baltic and International Maritime Council said tonne-miles from U.S. coal exports have declined by half over the past thee years.
Source: BIMCO, EIA
Tonne-miles from U.S. coal exports have declined by half over the past three years, according to an analysis from The Baltic and International Maritime Council (BIMCO).
In 2015, U.S. coal exports generated 378 billion tonne-miles, down from 715 billion tonne-miles in 2012, BIMCO Chief Shipping Analyst Peter Sand said.
“This decrease in tonne-miles is a contributing reason to the current state of the dry bulk shipping market, as U.S. coal trade was responsible for 14.8 percent of the world seaborne coal trade in 2012, but only 7.7 percent in 2015,” BIMCO said.
U.S. coal is particularly important to the dry bulk shipping business because of the long-haul routes carrying coking coal used in steel production from the U.S. East and Gulf Coasts to East Asia.
There is less demand in Asia for metallurgical coal and Europe is demanding less thermal coal used in electrical generation.
Overall, between 2012 and 2015, the average distance coal has been transported has not particularly changed, BIMCO said, meaning the diminishing tonne-miles are solely due to a reduction in volumes across the board.
“Japan and South Korea are the importers that are keeping the East Asian tonne-miles high, as China has not imported any significant amount of coal from the U.S. in the last two years,” BIMCO said. “The tonne-miles generated from Chinese imported U.S. coal is at its lowest level since 2009.”
Instead, China is focusing on regional suppliers, importing 84.1 percent of all coking coal from Australia and Mongolia during the first three quarters of 2016.
Coal exports to Europe were 38 percent lower in the first half of 2016 compared with the first half of 2015. Even so, the European Union is the main exporter of both coking and coking coal from the U.S., accounting for 43 percent in the first half of this year compared with 47 percent in the first half of 2015.
BIMCO said coal exported from the U.S. to the United Kingdom dropped by two million tonnes from the first half of 2015 to the first half of 2016, a total decrease of 83 percent. “This is the biggest decline for coal exported from U.S. to a single country. This is primarily due to the doubling of the U.K. carbon price floor (CPF), which has significantly increased the price of coal-fired energy production in the U.K.” BIMCO said. “Therefore, the U.S. thermal coal exports to the U.K. are down 98 percent compared to the coking coal export being down 63 percent for H1 2015 compared to H1 2015.”